The global equity income sector is among the youngest in the industry, and it is also one of the fastest-growing.

Created by the Investment Management Association only at the start of 2012, by the time its first birthday came around last month the sector had already attracted net inflows of £1.4 billion. Given the benefits on offer, which include income, portfolio diversification, and the potential for capital growth, it's easy to see why.

Traditionally, equity-income approaches have focused on a single country. For UK investors, this has generally been the domestic stock market, which has acquired a reputation as a high-yielding market. Sentimentality also plays its part here. Investors often feel comfortable with companies whose products they use in their day-to-day lives. But this is changing fast.

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Today, the UK market's high-yielding reputation is fading, while a growing number of international rivals are paying increasingly attractive dividends. By the end of 2012, none of the world's top 10 high-yielding stocks were UK-listed.

Indeed, UK-focused investors may be surprised to learn that of the world's 100 highest-yielding companies, 84 are listed outside Britain.

Because of the greater degree of choice (a good thing in itself), searching for income globally also reduces the risk associated with income concentration. For example, the top 10 dividend payers in the MSCI UK account for 51% of the income available from the index, so if one suspends its dividend – as BP did following the Gulf of Mexico oil spill – investors can be hit hard. By contrast, the top 10 in a global context provide just under 10% of the income available from the corresponding world index.

For newcomers to global equity income investing, several other aspects of the sector will come as a surprise. One is the performance of the kind of stocks in which global equity income strategies typically invest. At Martin Currie, I focus on high-quality companies from around the world that offer high, growing, and sustainable dividends.

It would be easy to suppose that restricting a portfolio solely to such companies would necessarily mean sacrificing something in terms of performance. History, however, suggests the opposite.

Take the MSCI World High Dividend Yield index, which comprises 300 high-yielding stocks with growing and well-covered dividends.

Over the 17 years since its inception, it has not only delivered a better total return (ie with dividends reinvested) than either the MSCI World or the FTSE-100, but it has also outperformed in capital-only terms. What's more, it has done so with lower volatility than either of these indices.

So in summary, a global equity-income approach offers not only a welcome degree of diversification for income-focused investors, but also the prospect of superior returns for those who seek long-term capital growth. The current environment of low interest rates and bond yields only adds to the appeal – especially as many of the largest companies have healthy balance sheets, giving them plenty of scope to return cash to shareholders.

But perhaps the most surprising thing is the scale of the opportunity yet to be taken up by UK investors. As of the end of 2012, a whopping £54.4bn was still invested in the 100 existing UK-focused equity income funds, while the 22 global equity income funds accounted for just £5.1bn. By the time of the sector's second birthday next Hogmanay, I'll be amazed if this last figure hasn't increased considerably.

Alan Porter manages the Global Equity Income Fund & Securities Trust of Scotland at Martin Currie